U.S. Economy Accelerates to 4.1% Rate in Second Quarter

Consumers and government spending powered the economy to a 4.1% rate of gross domestic product growth in the second quarter, the fastest pace in almost four years. Growth was revised up in the first quarter to 2.2% from 2%.

Activity boomed in the second quarter and the growth does not seem to be due to one-off factors, as some economists had feared.

Over the past year, the economy has expanded at a 2.8% annual pace, up from a 2.6% annual rate in the first quarter. Economists say this is strong enough to keep putting downward pressure on the unemployment rate.

Fed Chairman Jerome Powell has said that strong growth is one reason the central bank should keep raising interest rates. With inflation moderate, the Fed is expected to stay on the pace of a quarter-percentage point rate hike every three months.

Many analysts think growth should stay strong, helped by stimulative fiscal policies, such as tax cuts. There is concern reported in various business surveys that trade disputes could slow activity, but so far there is little evidence of any disruption in the economic data.